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SSP Group PLC shares surged on Thursday as it reported trading has ‘gained momentum’ in recent weeks and it announced a ‘wide-ranging review’ of its Continental European rail business. SSP shares jumped 15% to 169.80 pence each in London on Thursday morning, the best FTSE 250 performer. The operator of food and beverage outlets in travel locations in 38 countries said it is also mulling options to ‘realise value’ in recently-listed Indian investee Travel Food Services Ltd. London-based SSP, which operates Upper Crust, swung to a pretax loss of £10.4 million in the year ended September 30, from profit of £118.6 million. Non-underlying operating costs of £183.0 million, stretching from £40.7 million the year prior, weighed on SSP’s bottom line. This time around, those costs included a £50.7 million impairment of property, plant and equipment, £33.4 million in IT transformation costs and £12.7 million in restructuring costs. Underlying pretax profit improved 9.7% to £172.3 million from £157.0 million the year prior. Revenue for the year climbed 6.0% to £3.64 billion from £3.43 billion. SSP raised its final dividend by 22% to 2.8p per share from 2.3p. Its total dividend is 20% higher at 4.2p from 3.5p. ‘We have delivered a resilient financial performance this year,’ Chief Executive Officer Patrick Coveney said. ‘As a result of our actions in the year including an ongoing focus on cost efficiency, we saw strong trading across three of our four regions. However, we acknowledge there is more to do to strengthen our operational performance, most notably in Continental Europe where we have now reset our team, model and balance sheet, and have a range of initiatives underway to do so.’ The Continental European arm has struggled with a ‘slow return of passenger numbers’ since the pandemic. SSP added: ‘Given this under-performance and in addition to the revised operating plan for Continental Europe, the board has initiated a wide-ranging review of our Continental European Rail business. This review, to be supported by Alvarez & Marsal, will consider and assess all potential options. The board expects to be able to update on this review on or before our interims in May 2026.’ Alvarez & Marsal is a consulting firm. In addition, it announced it is considering options ‘to realise value for SSP shareholders’ in line with a plan to ensure its Travel Food Services investee meets a free float requirement. Travel Food Services went public in Mumbai back in July. SSP currently has just over 50% of TFS, which was a joint-venture owned alongside K Hospitality Corp. ‘At the point of the TFS IPO, our partners and co-promoters, the K Hospitality, sold down 13.8% of their shareholding to create an initial free float,’ SSP explained. The sale by K Hospitality left it with a roughly 36% stake in TFS. Combined with SSP’s stake, the duo’s current holding stands at about 86%. However, a minimum free float of 25% is required within three years of listing, SSP explained. ‘We continue to believe that India’s market potential, combined with TFS’ attractive economic model and market leadership, and a strong and balanced ongoing partnership between SSP and K Hospitality, offers a compelling opportunity for growth and returns for the group. As we work with our partner K Hospitality, to develop forward-looking plans for TFS, the board will explore options to realise value for SSP shareholders in line with the delivery of the TFS free float requirement,’ SSP added. TFS has a market capitalisation of ₹175.40 billion, around £1.46 billion. Turning to current trading, SSP said it has ‘gained momentum’ since the financial year ended. Revenue in the eight weeks to November 25 was 6% higher on-year, helped by 4% like-for-like growth. ‘While there remains a substantial level of uncertainty in the demand outlook across certain travel markets, the group is well placed to navigate these challenges,’ SSP added. It expects to deliver earnings per share at the upper end of a 12.9p to 13.9p range, excluding the expected benefit of an ongoing share buyback. Earnings per share in financial 2025 rose 19% to 11.9p. It also expects pre-dividend free cash flow to top £100 million, compared to £80 million in the year just ended. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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